House price forecasts have improved in just one month and significantly from a year ago, analysis shows.
The Treasury regularly compiles independent forecasts to show how City analysts and thinktanks predict that certain parts of the UK economy will perform.
The latest report for August 2024 shows the average forecast for annual house price growth among City analysts is 2%, while independent thinktanks have predicted 2%.
This ranges from highs of 3.8%, predicted by Oxford Economics to a drop of 2% based on CEBR forecasts.
The median prediction is 2% growth.
It comes as estate agents and property market commentators report that slowing inflation and the recent interest rate cut is boosting housing demand, which could feed into sales and prices.
This is already an improvement on July, when the highest forecast was for 2% and the lowest was a 2.5% decline, with a median figure of 0.8%.
Meanwhile, this time last year – amid rising mortgage rates and inflation of 6.7% – the best hope for house prices was a 0.2% drop and the worst was an 11.7% decline.
This shows what can change in a year, and also to perhaps not worry too much about house price forecasts.
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Of course, as long as the government keep the supply low and demand high house prices will continue to grow, not to mention the measures they're planning to put in to place to artificially stimulate the market, such as the mortgage guarantee scheme. We are facing the highest house prices in history and a 12% decline is insignificant when comparing the growth over the past 10 years against average inflation and salary rises.
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